M&S will not accept personal cheques at its 20 stores from March 1, saying the handwritten payment orders represent fewer than 2% of all transactions today.
Last year, retail giants Argos, Penneys and Boots stopped accepting cheques in Ireland alongside independent retailers like petrol stations who introduced the ban on security as well as cost grounds.
But Tesco — Ireland’s largest grocery supermarket — as well as department store Brown Thomas said they have no plans to stop their customers paying by cheque.
Yesterday Ireland’s banks predicted the rocketing growth of the debit card — an electronic version of the cheque — could spell the death of the chequebook.
“We’re delighted M&S is taking this step as we’re trying to get more people to move away from inefficient forms of payment like the cheque as well as cash,” said Úna Dillon, from the banks’ Irish Payment Service Organisation (IPSO).
“There are European countries where they don’t use cheques — every payment here can be done electronically and almost everyone has a bank account with internet or phone banking.”
Compared with 2006, the number of transactions on debit cards last year soared by 38 million (or 38.4%) to 137 million while the value of sales leapt €2.4 billion (or 35.8%) to €9.1bn.
In 2006, Irish consumers had their cards swiped99 million times, spending €6.7bn on debit cards.
The same year, consumers and businesses wrote124.2 million cheques to a total value of €872bn, but the IPSO said most of the cheques were drawn by companies and were not personal ones.
Cheque figures for 2007 are out soon, but their use is expected to decline, the IPSO said.
Finance Minister Brian Cowen has doubled stamp duty on cheques to 30c each, with the tax on a typical book of 25 cheques amounting to €7.50 as opposed to the €5 annual levy on debit cards.
Ms Dillon said the latest figures showed just 8% of Ireland’s adults, chiefly social welfare claimants, did not have a bank account, and therefore no bank card, but the IPSO was working towards giving them a payment card.
Yesterday, the Consumers’ Association of Ireland (CAI) said the decline of the cheque was welcome.
However, it said the banks needed to do more to help the elderly switch over to new forms of payment.
“Having spoken to retailers, they’re more concerned about the security aspect of cheques rather than the cost,” said CAI chief executive Dermott Jewell.
He said the Government and banks should consider waiving stamp duty as well as transaction fees on electronic payments.
“You can understand the reticence of people to switch over as they’re familiar with cheques but a simple measure like waiving stamp duty on payment cards would help,” he said.